Self Assessment and CIS

W4rZ

Hi people I need some guidence completing my tax return.
The first thing is that I have an Ebay business as a Sole trader that part of it I understand Enter your Total Income minus costs and expenses,what Im stuck at is how CIS fits in because Im registered to CIS as a BT contractor and have everything in place with a UTR.
When I start my tax return im confused because there is no reference to CIS other than a section

"Deductions on payment and deduction statements from contractors - construction industry subcontractors only"
Would this be where I enter any expenses for CIS as it does not have a detailed section as such to list your expenses such as tools etc
One other thing my tax return last year resulted in a loss does any former year loss get carried over?
Many Thanks

Skint_yet_Again

If I understand you correctly you have 2 self employments, 1 as an ebay seller and one as a subcontractor (BT) under CIS ?

If this is correct you will have to complete 2 self employment pages, one with Ebay & no CIS and one for your subcontracting with CIS tax deducted.

I am not sure if you are completing a tax return online or on paper (SA103s or SA103F) ? Please confirm and we can then tell you where to enter CIS expenses/tax.

Which trade made a loss last year - the ebay selling or subcontracting?

chrismac1

Note the following CIS pitfalls which many folk, including accountants, fall into:

1. Your sales are "grossed up." So if you are doing labour only sales, and BT paid you £20k into your bank, then £25k is the figure for your sales.

2. You are probably doing your accounts to 31 March or 5 April. If you have chosen another date, the box for CIS deducted should cover deduction statements dated 6 April 13 to 5 April 14 regardless of your choice of accounting period year-end.

There are various ways of getting relief for losses. Assuming it is your e-bay business which made the loss, as it is very difficult to lose money as a CIS subbie, you carry these losses forward to the next available profits from the same trade.

Overall, unless you are pretty hot on doing tax returns you have a number of ways to muck this up DIY and if you have any sense you'll find a decent local accountant to sort it.

W4rZ

Yes my loss was my ebay business I have been on to look at the form there is a box which you fill out about former losses but do I enter that loss into that box and it carrys forward?I have try to do this but just back as an error must do doing something wrong?
This is the error!
"The amount entered for 'Loss from this tax year set-off against other income for 2013-14' cannot exceed the positive equivalent of the amount entered for 'Net business loss for tax purposes'. Please amend."
When you say to do to forms would that mean I need to add a 2nd business for the CIS claim?

If so do I need to input all of my earnings from my contractor even tho the tax is deducted at source then deduct the tax on the form and then add any expenses?,it is a online form im looking to fill out.

chrismac1

The questions you are asking mean there is roughly a 10% chance of you getting this right doing it yourself. Because you'll be making similar blunders elsewhere and not realising it and not posting it.

The only sensible advice is to bite the bullet and look for an accountant. Personally I won't be posting any further advice into this thread.

purdyoaten

W4rZ wrote: »

Yes my loss was my ebay business I have been on to look at the form there is a box which you fill out about former losses but do I enter that loss into that box and it carrys forward?I have try to do this but just back as an error must do doing something wrong?
This is the error!
"The amount entered for 'Loss from this tax year set-off against other income for 2013-14' cannot exceed the positive equivalent of the amount entered for 'Net business loss for tax purposes'. Please amend."
When you say to do to forms would that mean I need to add a 2nd business for the CIS claim?

If so do I need to input all of my earnings from my contractor even tho the tax is deducted at source then deduct the tax on the form and then add any expenses?,it is a online form im looking to fill out.

The loss from last year's ebay business can only be carried forward against this years ebay business. It needs to go into the following box:

Total loss to carry forward after all other set offs - including losses brought forward.
Total loss to carry forward after all other set-offs
–
including unused losses brought forward

You need to complete a separate self-employment section for the CIS income.

Loss claims are a specialist area of taxation - not for the amateur.

If you are not 100% certain of your entries, please do not be completing this without assistance. The questions that you are asking regarding the recording of the income under CIS do highlight your lack of knowledge -really not worth a HMRC investigation to save a few quid on accountancy fees.

chrismac1

Bearing in mind, also, that the construction sector is the one with the highest level of HMRC activity, due to the history of the "lump" and similar dodgy practices. That is why, unique to itself, it has a special little tax system of its own - called CIS and with very hefty penalties for mucking it up.